So, you’ve decided to put your home on the market! And now, you’re eagerly anticipating the moment you’ll trade in the house keys for a big pile of cash to fund your next big adventure.
However, it goes without saying that selling your home is one of the biggest transactions you’ll ever make, and messing it up will spell disaster or your other financial goals – something you simply cannot afford.
Therefore, it’s important to exercise patient and do some proper research before you make a selling decision. To help you avoid making any decisions that you may regret further down the line, we’ve compiled a list of some of the most common home-selling mistakes. Here they are.
Selling When You’re Underwater With Your Mortgage
People who still owe a mortgage on their property can use a percentage of the sales proceeds to pay off the remainder of their loan amount. However, what if the value of your property has plummeted? What if the loan amount that you owe is higher than your property’s current worth? This is referred to as being underwater, or upside-down on your mortgage, or having negative equity on your property.
If you decide to sell when your underwater with your mortgage, you’ll still be stuck in debt – even though you’ve have used up all the sales proceeds to pay off your loan. It’s better to break even on your home sale, but even that is not the ideal scenario.
If you find yourself in such a situation, selling your home isn’t a good idea unless you’re looking to avoid foreclosure or bankruptcy. There are various other ways to deal with an upside-down mortgage. However, typically, the smart choice is to stick with your current home and work on building more equity before you put it on the market.
Selling Your Home Yourself
Now, this is a massive one. Taking the “For Sale By Owner” (FSBO) route, or in other words, not using a real estate agent, is one of the most common and biggest home-selling mistakes. Of course, when you take the FSBO route, you save some money by not having to pay a commission. However, if you look at the facts and data, you miss out on the chance of making much more money when you decide to go solo. According to an NAR report, the average FSBO home sold for $200,000, compared to the typical agent-assisted $285,000. That’s an $80,000 difference!
Fortunately, the majority of sellers know that its smarter to hire an agent to assist them with their home sale. The same NAR report revealed that only 10% of home sellers took the FSBO route in 2018. And that really makes sense as well. You see, a reputable and experienced real estate agent brings a lot to the table, including specialized knowledge of the local market and expert negotiation skills.
Pricing Your Home Wrong
Now, assigning the right price to your home isn’t as easy as it seems. Price it too low, and you’ll be missing out on thousands and thousands of dollars. Too high of a price will chase away serious buyers, and your home will be sitting on the market for weeks, or even months, and you’ll ultimately have to reduce your price.
While internet listings and the local yellow pages can be a good resource when setting a price on your home, don’t use them as your only resources. The smart decision here is to seek the advice of an experienced local realtor. They’ll perform a comparative market analysis, providing you an insight of the current home values in your area. This will allow you to make an informed, data-backed decision.
Setting the right price from the off could be all the difference in terms of how much cash ends up in your account at the closing table, and how quickly you end up selling your property.
Hiding Major Repairs
Think you’ll be able to hide that roof leak or that bug problem from your prospective buyers? Well, think again. The modern homebuyer is a smart breed, and most of them are assisted by a real estate agent who’s well-versed on the ins and out of purchasing a house. So, don’t be surprised if they go through with a home inspection after their offer has been accepted.
And if the home inspection reveals that you haven’t been entirely honest about the condition of the house, the closing date could end up getting delayed, or the buyer may even decide to terminate the deal altogether. This will not only cost you time and, potentially, money, but could also end up damaging your reputation in the market if the word gets out.
Therefore, the best option is to have a home inspection performed yourself before you put the property on the market. This way, you’ll be able to ensure that it’s great shape for any potential buyer.
Not Staging Your Home
While home staging doesn’t sound too big of a deal, ignoring this small but crucial step is a major home-selling mistake. Talk to any experienced realtor and they’ll tell you that staging your home could significantly accelerate the selling process. Moreover, 33% of agents state that staging your home can increase the amounts buyers offer by 1-5%, while others stated that it boosted the amount by 6 to 10%! In other words, if you stage a home that’s worth around $300,000, you may be offered an extra $3,000-$30,000! Not bad for a few hours’ worth of effort, right?
Want another pro tip? Rent out decorations and furniture form a staging company instead of showing an empty house to your prospective buyers. This’ll help them envision how the house would look like if it became their home.
Using Bad Quality Listing Photos
Thanks to the internet and smart handheld devices, homebuyers can cruise through home listings from the comfort of their couches. In fact, according to a recent report, half of all homebuyers in 2018 found their new hoe online.
So, if your listing photos look like they’ve been captured with a potato, you’ll lose the interest of potential buyers before they ever pull up to your house front. Therefore, consider investing in a pro photographer who can really make your house look its best. You’d be surprised at the difference a wide-angle lens and the right lighting can make.
We know it seems like a needless expense, but trust us – it’s definitely worth it.
Taking Offense to a Low Offer
It’s important to remember that the amount a buyer offers for your home doesn’t reflect their opinion of your property or your housekeeping skills. If they’ve made an offer it mean they like your home, right? So, instead of considering a low offer as an insult, make a counteroffer. Now is the time to negotiate!
Working under the banner of Fathom real estate, Philip Fehler is one of the most experienced expert realtors in North Carolina. He has extensive knowledge in terms of investments, buying and selling houses in Fayetteville, military housing in Fort Bragg, and more. For more information, you can get in touch with Philip Fehler online or give him a call at (910) 381-1341.